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Think Twice about Chucking that Letter from Your Credit Issuer


I’ve become somewhat of an expert mail sorter over the years. It’s almost like I’ve developed a robotic sixth sense for detecting worthless mail at first glance. I pull out a stack that weighs 5 pounds from the mailbox, sit it on the counter, and in less than 60 seconds I walk away with a few more wedding invitations in hand and a healthy contribution of unopened junk mail for the shredder.

I must admit I get duped from time to time. Those letters that really look like they’re from your mortgage company and say “Time-Sensitive Documents Enclosed” are my worst enemy. For a split second they always cause me to hesitate and lose focus. Inside I really want to open them to see if they’re for real, but my sixth-sense tells me “Don’t waste your time – it’s just another ad!” I cave in on occasion and risk another painful papercut to appease my curiosity. I’m usually disappointed.

Unfortunately, I’ve had to devote extra time lately to this daily process because we should all be thinking twice about throwing away any unopened letters from our lenders or credit card companies. In this recessionary climate, it’s a well-known fact that credit card companies and home lenders are taking drastic measures to tighten the reins on consumers and minimize their exposure to risk. That letter you are throwing away might be notifying you of a large interest rate hike, a reduced credit limit, or a home equity line that will be canceled. You might expect them to notify you by email as well, but that’s not always the case. An actual letter is often required by law.  Here's a little anecdote to help you sift through the credit card mail and find what's actually important:

Credit card advice

I received one the other day from Citibank for a credit card I’ve had for a long time, but rarely use. It had a sizable credit limit, I’ve never missed a payment, always paid the balance in full, and still used it from time to time. Obviously not often enough. Citibank said they wanted to help me “better manage my credit accounts”, so they closed the account due to inactivity. Thanks a lot Citibank! So thoughtful of you. My east-coast sarcasm should be shining through right now.

So, if you have mad mail sorting skills too and can fly through a huge stack in under 60 seconds, I suggest training your eye to catch anything that could possibly be from your lenders or credit issuers. Take a few minutes to read the letters and make sure you understand what’s going on with your accounts. If you’re unhappy about the new conditions or an account closure, pick up the phone, give them a call, and ask to speak to a supervisor who has authority to make changes to your terms. You may be surprised how much you can actually accomplish when making a reasonable request to the right person.

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Joshua Heckathorn's picture

Joshua Heckathorn was President of Creditnet, is a credit expert and has been featured on CNNMoney, FOX Business, Yahoo Finance, The Street, and many other national publications during the past ten years.  He received a Bachelor of Science in Management (Finance) from Brigham Young University's Marriott School of Business and earned his MBA from Seattle University.

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Jennifer S.'s picture

The same thing happened to one of my Citi cards just a few weeks ago. I was actually halfway through tearing it up before I had a hunch to read the letter. I had always kept the card in my wallet for emergencies and would have been SOL if I tried to use it after it was canceled. Thanks for the post, I enjoy reading your thoughts!

Joshua Heckathorn's picture

Thanks for your comment Jennifer S...glad you enjoy our blog. Please come back often and tell a friend too!

Gwendolyn's picture

I had a very similar situation happen to me, but not without consequences.
I used the convenience check that was sent with my last WAMU Visa statement to pay off one of my husband's cards thinking that everything was fine. I have a low interest rate and a $14,000 credit limit without a balance on it, never been late with a payment and have had this card since 1998. I sent the check out about a week ago.
I received a letter in the mail today saying that they have closed my account due to inactivity for the last 12 months. They closed it on Nov. 14th, I got the letter today, on the 28th. I know have to call my husband who is serving in Iraq to tell him that the check I used that was sent to his card was no good and he has to find a way to call his card company and explain what happened to see if they will waive any NSF, late or bad check fees involved.
I tried to get customer service, but after speaking with 4 supervisors they said that noone is getting their account reinstated and I am SOL. Why would they send me a check with my statement encouraging me to use it anytime until December 14th for a special rate on balance transfers if they were planning on closing my account 2 weeks after sending it to me??? One would think there should have been a notice that it was going to close, not a check attached.
This is going to kill my credit score... I just went from $22,000 available credit line to $8,000 and lost about 7 years of credit history. My only other card has only been open for three years. Before this, I had a 760 FICO, I am really scared where it is going to end up. We are in the process of buying a house, thank god everything has already been run and the rate locked in.

Joshua Heckathorn's picture

I'm sorry to hear about your situation Gwendolyn. WAMU is practically in a state of chaos right now, so it doesn't surprise me to hear they are clearly having internal communication problems. They shouldn't have sent you a special advertisement when they were planning on canceling your account; however, at the rate things are changing in the banking world these days, the decision to cancel the account may have very well been made after the advertisements were released. I hope you can quickly secure a new credit card to increase your available credit limit again, which should help with your score. Please come back and let us know how it plays out for you. Good luck!

Sundy's picture

I know this is an old post, but I feel I MUST chime in. I used to throw away those pieces of mail that I felt were junk without even opening them...especially my mortgage ones. I already had online access to all of my statements, I reasoned, so why bother keeping the paper statements. (This was before I went paperless with them.)

They (the mtg co) had started sending a lot of offers to refi, etc., which I would instantly recognize as different from my statements and throw those away quickly, too.

One day, a little voice told me to open the envelope before I trashed it. It was a check for over $600 that I received as an overpay from my closing costs!

I open ALL of my mail now. Ya never know! :)

Joshua Heckathorn's picture

Great story...thanks for the post Sundy. Yet another reason why you should always take at least a quick peek in those envelopes. Happy New Year to you!